Antibiotice : Audited economic and financial results of 2018 – 8% increase in sales revenue and 2% profit after tax

The General Shareholders' Meeting, held on Thursday, April 18, 2019, approved the audited financial statements of 2018, determined the distribution of the net profit for the year 2018 and the gross dividend value per share.

Audited economic and financial results of 2018 - 8% increase in sales revenue and 2% profit after tax

Following the strategic objectives focusing on the internationalization of the business, in 2018 Antibiotice's performance marked an 8% increase in sales revenue compared to 2017, reaching the value of 364,576,466 lei. The company also recorded a net profit of 2% during the same period, reaching the value of RON 34,303,788 and an operating profit which increased by 5% to 39,312,791 lei.

The financial results of the year 2018 reflect a broad activity management program with effects on business profitability and the considerable impact of the clawback tax, which increased by 25% compared to 2017, reaching 36,484,667 lei, thus exceeding the value of the net profit.

9.4% increase in turnover on the Romanian market

On the domestic market, Antibiotice recorded an increase in turnover of 9.4% in 2018 compared to 2017 (according to the explanatory notes to the financial statements). In the same period, according to the market research firm Cegedim Romania, sales from pharmacies and hospitals registered a 7.4 percent increase, reaching 339.3 million lei.

Against this background, Antibiotice maintains its leading position in the generic and OTC marketed sector in hospitals, with a value of 85.8 million lei in 2018, up 8% from the value recorded in 2017 (79.5 million lei ), with a market share of 18%.

At the same time, the portfolio utilized in 2018 allowed maintaining the leading position for injectable powders (market share 72%) and in terms of units sold on the ointment segment (market share 26%) and suppositories (market share 42% ).

On the generic and OTC segment, the company ranks 3rd with a market share of 5%, while in the top of non-prescription drugs and food supplements (OTC), Antibiotice is ranked 13th out of a total of 221 companies, in climbing compared to 2017. In 2018, Antibiotice's growth rate in this segment is 14.4%, equal to the total profile market (14.4%).

Exports reached 35% of total sales. Nystatin marketed in over 50 countries.

Exports grew by 6% over the previous year, reaching 124 million lei (31.5 million USD), representing 35% of total sales.

The Nistatine product, accounting for 52% of the export value, increased by 10% compared to 2017, being used by manufacturers in more than 50 countries as a raw material for the manufacture of tablets, oral suspensions, topical preparations (creams, ointments) eggs.

Sales up 37% in Vietnam. New representation opened in Ukraine.

The main growing market in 2018 was that of Asia, the result of the opening of its own Vietnam office, with sales up 37%.

In 2018, Antibiotice inaugurated its third representative office in international markets, this time in Ukraine, an emerging market with an annual growth rate of over 15%.

Through this territorial expansion strategy, the company expands its development area to the Russian-CIS region for the finished product portfolio. Starting with 2020, the first branded products will be launched within partnerships with local distributors and chain of local pharmacies.

This representation joins the open ones in previous years in Vietnam and the Republic of Moldova, which are successful models of implementing an organic growth strategy in a territory by transforming market opportunities into product, promotion and distribution policies.

In parallel, collaboration has been established on new markets in Africa such as Tunisia, South Africa, Ethiopia and Southeast Asia - the Philippines and Hong Kong, prerequisites for business development from 2020.

The main investments in 2018

The investments made by Antibiotice in 2018 had a central section of the new topical product section, which is to be the most modern in South East Europe and which involved investments of 22,607,501 lei (equipment, clean rooms and installations utilities). Putting it into operation in 2020 will drive exports of topical products to key markets in Europe, the US and Canada.

At the same time, substantial investments were made in the effort to align with the European and American legislation on combating counterfeiting in the pharmaceutical industry. The total amount of resources allocated over the last 2 years for serialization and software equipment amounted to 20 million lei (4.4 million euros).

Approving the distribution of net profit for the year 2018, fixing the gross dividend per share and setting the payment deadline
Following the submission to the AGM meeting, the shareholders of the company decided to allocate the net profit for the year 2018 and the gross dividend per share for the financial year 2018, of 0.009991506 lei. Payment of dividends for the year 2018 will be made from September 20, 2019, according to the legal provisions in force.

The accounting profit of RON 34,303,788 for the year 2018 was allocated as follows:

Profit to be distributed 34,303,788 lei

Reverva legal 0 lei

Other reserves from profit provided by law 27,596,111 lei

Dividends of which: 6.707.678 lei

dividends to the majority shareholder of RON 3,556,228
dividends due to other legal entities and individuals 3.151.450 lei
Antibiotics in 2018:

- world leader and international quality standard for the active substance Nistatine;

- 35% of the turnover is made from export sales;

- 3rd place among manufacturers of generic medicines and non-prescription medicines (OTC) in Romania;

- the leader in terms of therapeutic units used on injectable powder form - 72% market share;

- leader of the Romanian ointment market - 26% market share;

- the leader of the Romanian suppository market - 42% market share;

- the main producer of generic medicines for hospital consumption;

- Sales revenue increased by 8% compared to 2017;

- Net profit increased by 2% compared to 2018;

- Operating profit increased by 5% compared to 2017.

Persons interested in additional information can consult the Annual Report 2018, the Bucharest Stock Exchange (iris.bvb.ro), the Financial Supervisory Authority (www.asfromania.ro) or the Antibiotice SA website (www. antibiotics.com), Investors section - Shareholder information - Financial information - Annual report -2018.